United States District Court, C.D. California
TRUSTEES OF THE OPERATING ENGINEERS PENSION TRUST, TRUSTEES OF THE OPERATING ENGINEERS HEALTH AND WELFARE FUND, TRUSTEES OF THE OPERATING ENGINEERS VACATION-HOLIDAY SAVINGS TRUST, TRUSTEES OF THE OPERATING ENGINEERS TRAINING TRUST, TRUSTEES OF THE OPERATING ENGINEERS LOCAL 12 DEFINED CONTRIBUTION TRUST, FUND FOR CONSTRUCTION INDUSTRY ADVANCEMENT, ENGINEERS CONTRACT COMPLIANCE COMMITTEE FUND, CONTRACT ADMINISTRATION FUND, SOUTHERN CALIFORNIA PARTNERSHIP FOR JOBS FUND, AND OPERATING ENGINEERS WORKERS COMPENSATION TRUST, Plaintiffs,
v.
WEST COAST BORING, INC., Defendant.
ORDER GRANTING IN PART AND DENYING IN PART
PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT [15]
OTIS
D. WRIGHT, II UNITED STATES DISTRICT JUDGE
I.
INTRODUCTION
Plaintiffs
Trustees of the Operating Engineers Pension Trust, Trustees
of the Operating Engineers Health and Welfare Fund, Trustees
of the Operating Engineers Vacation-Holiday Savings Trust,
Trustees of the Operating Engineers Training Trust, Trustees
of the Operating Engineers Local 12 Defined Contribution
Trust, Fund For Construction Industry Advancement, Engineers
Contract Compliance Committee Fund, Contract Administration
Fund, Southern California Partnership For Jobs Fund, and
Operating Engineers Workers Compensation Trust (collectively,
the “Trust Funds” or “Plaintiffs”),
brought suit against Defendant West Coast Boring, Inc.
(“WCB”) for delinquent contributions required by
the collecting bargaining agreement (“CBA”)
between WCB and Local Union 12 (“Local 12”). The
Trust Funds now move for entry of a default judgment against
WCB. For the reasons discussed below, the Court GRANTS the
Motion IN PART. (Mot. for Default J. (“Mot.”),
ECF No. 15.)[1]
II.
FACTUAL BACKGROUND
WCB and
Local 12 entered into a CBA on August 17, 2000. (Compl.
¶ 8, ECF No. 1; Decl. of Bernardo Ramos (“Ramos
Decl.”) ¶ 8, ECF No. 17.) Under the CBA, WCB was
obligated to make contributions to a multiemployer plan, and
submit true, complete, and accurate written monthly
contribution reports. (Compl. ¶¶ 14, 15.) WCB
agreed to pay to Plaintiffs fringe benefit contributions,
benefits and/or withholdings on a monthly basis, and at
specified rates for each hour worked by, or paid to,
applicable employees. (Compl. ¶ 15.) Per their
agreement, if WCB paid any employee in a manner other than an
hourly wage, WCB must pay Plaintiffs fringe benefit
contributions on behalf of that employee based on a 40-hour
work-week. (Compl. ¶ 16.) The Trust Funds also allege
that, per the terms of the CBA, WCB agreed to comply with
audits of payroll and related records to ensure all fringe
benefits were paid. (Compl. ¶¶ 15, 28.)
WCB
submitted monthly reports from September 2018 through
February 2019 but failed to pay the contributions due.
(Compl. ¶ 17.) Plaintiffs allege WCB owes $17, 915.40 in
fringe contributions for this time period. (Compl. ¶ 17;
Ramos Decl. ¶ 14.) Furthermore, WCB allegedly failed to
provide monthly reports from April 2019 through the present,
in violation of the CBA. (Compl. ¶ 18.)
Local
12 and WCB agreed to modify their agreement for WCB's
principal employee Mr. Robert Sanders. (Compl. ¶¶
16, 19.) On or about March 17, 2011, WCB signed a written
Principal Employee Program Participation Agreement (the
“PEPPA”), which permitted WCB to report and pay
contributions on behalf of Mr. Sanders at a flat monthly rate
in lieu of paying contributions based on a 40-hour workweek.
(Compl. ¶ 19.) However, the PEPPA provides that if WCB
fails to abide by the terms and conditions of the PEPPA, WCB
must revert to paying fringe benefit contributions for Mr.
Sanders based on a 40-hour work-week. (Compl. ¶ 19.)
Furthermore,
Plaintiffs claim that WCB breached the PEPPA by failing to
pay the flat rate contributions for Mr. Sanders for work
performed during the months of September 2018 through June
2019. (Compl. ¶ 20.) As WCB violated PEPPA, it allegedly
owes Plaintiffs fringe benefit contributions of $53, 488.06
based on a 40hour work-week for the months of September 2018
through June 2019. (Compl. ¶ 20.) Due to these
violations, WCB became “delinquent” per the CBA
and must pay the greater of $25.00 per month or ten percent
(10%) of the total amount then due as liquidated damages for
each delinquency. (Compl. ¶ 24.)
On July
29, 2019, the Trust Funds filed a complaint against WCB
requesting payment of the underpaid contributions,
prejudgment interest, liquidated damages, audit expenses, and
reasonable attorneys' fees and costs. (See Compl.) The
Trust Funds served the complaint on WCB on August 11, 2019.
(Proof of Service, ECF No. 9.) WCB failed to timely respond
to the complaint. See Fed.R.Civ.P. 12(a)(1)(A)(i). On
September 10, 2019, the Trust Funds requested that the Clerk
enter default against WCB. (Req., ECF No. 11.) The Clerk
entered a default on September 11, 2019. (Default by Clerk,
ECF No. 12.) On October 10, 2019, the Trust Funds filed the
instant Motion for Default Judgment. (See Mot.)
III.
LEGAL STANDARD
Federal
Rule of Civil Procedure 55(b) authorizes a district court to
grant a default judgment after the Clerk enters a default
under Rule 55(a). Fed.R.Civ.P. 55(b). Before a court can
enter a default judgment against a defendant, the plaintiff
must satisfy the procedural requirements set forth in Federal
Rules of Civil Procedure 54(c) and 55, as well as Local Rule
55-1 and 55-2. Fed.R.Civ.P. 54(c), 55; C.D. Cal. L.R. 55-1,
55-2. Local Rule 55-1 requires that the movant submit a
declaration establishing (a) when and against which party
default was entered; (b) identification of the pleading to
which default was entered; (c) whether the defaulting party
is a minor, incompetent person, or active service member; (d)
that the Servicemembers Civil Relief Act, 50 U.S.C. §
3931, does not apply; and that (e) the defaulting party was
properly served with notice, if required under Rule 55(b)(2).
C.D. Cal. L.R. 55-1. Finally, if the plaintiff seeks
unliquidated damages, Local Rule 55-2 requires the plaintiff
to give notice to the defaulting party of the amount sought.
C.D. Cal. L.R. 55-2.
If
these procedural requirements are satisfied, a district court
has discretion to enter default judgment. Aldabe v.
Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). In
exercising its discretion, a court must consider several
factors, including: (1) the possibility of prejudice to a
plaintiff; (2) the merits of plaintiff's substantive
claims; (3) the sufficiency of the complaint; (4) the sum of
money at stake; (5) the possibility of a dispute concerning
material facts; (6) whether the defendant's default was
due to excusable neglect; and (7) the strong policy
underlying the Federal Rules of Civil Procedure favoring
decisions on the merits. Eitel v. McCool, 782 F.2d
1470, 1471-72 (9th Cir. 1986). Upon entry of default, the
defendant's liability generally is conclusively
established, and the well-pleaded factual allegations in the
complaint are accepted as true, except those pertaining to
damages. Televideo Sys., Inc. v. Heidenthal, 826
F.2d 915, 917-19 (9th Cir. 1987) (per curiam) (citing
Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th
Cir. 1977)).
IV.
DISCUSSION
A.
Procedural Requirements
The
Court finds that the Trust Funds have complied with the
relevant procedural requirements for the entry of a default
judgment. Counsel submits a declaration attesting that: (a)
the Clerk entered a default against WCB on September 11,
2019; (b) the default was entered on the original complaint
filed by the Trust Funds on July 29, 2019; (c) WCB is not an
infant or incompetent person; (d) WCB is not covered under
the Servicemembers Civil Relief Act; and (e) the Trust Funds
served WCB with notice of the request for entry of default
(additional notice was not required per Local Rule 55-2).
(Decl. of Marija Kristich Decker (“Decker Decl.”)
¶¶ 7-11, ECF No. 18.) Accordingly, the procedural
requirements are satisfied.
B.
Eitel Factors
The
Court finds that the Eitel factors weigh in favor of entering
a default judgment. The ...